On 19 March 2018 the EU and UK held a joint press conference to announce that they had reached agreement on a number of key areas of the withdrawal agreement. Most notably for employers in the UK, the length of the transition period has been agreed, as well as key features of the process and timing for EU nationals in the UK to apply for residence documentation. This follows a number of negotiating sessions over the past weeks, since the initial publication of the draft withdrawal agreement on 28 February 2018.

While the draft withdrawal agreement has been largely agreed by the UK and the EU, it will only be ratified later this year (likely in the autumn). This means that a degree of uncertainty remains for businesses and EU nationals in the UK.

Key points for employers in the UK:

  • The transition period or implementation period (as the UK is referring to it) will be for a 21-month period from Brexit Day on 29 March 2019, until 31 December 2020. For the duration of this period free movement of EU/EEA nationals will continue.
  • EU/EEA nationals who are resident in the UK prior to Brexit Day will have six months from the end of the transition period to apply for residence documentation, i.e. settled status or a temporary residence permit.
  • As per Theresa May's speech on 28 February 2018, EU/EEA nationals who arrive in the UK during the transition period will be on a pathway to permanent residence.
  • Should an EU/EEA national fail to obtain new documentation before the deadline, some leniency will be exercised where the individual can demonstrate "reasonable grounds for failure". We will need to wait for further information on the definition of reasonable grounds, in addition to the consequences of failing to apply without reasonable grounds.
  • Evidence of residence status for EU/EEA nationals may be in digital form (which is in line with what we expect the UK to do).
  • If there are technical issues with the application system in either the UK or in EU member states, then the timeline to apply for residence documentation can be extended by 12 months. Including this clause in the withdrawal agreement may be tempting fate. However, all indications so far are that the UK is very motivated to ensure that technical issues are avoided.
  • One slightly concerning clause states that "the identity of the applicants shall be verified through the presentation of a valid passport or national identity card for Union citizens". This appears to conflict with reports that the residence documentation application process in the UK will be a streamlined online process. It could be that the UK will choose to take a more generous approach and not request original documentation, or they may use other methods to verify authenticity of identity documentation.
  • Other supporting documentation, such as evidence of employment and birth/marriage certificates for family members, need only be submitted as a copy – presumably a scan of the document attached to an online application. However, the government reserves the right to request original documents where they need to verify authenticity.
  • Applicants will need to be given the opportunity to provide additional supporting documentation and/or correct any errors or omissions – a stark contrast from the present process of automatic rejections in the event that an applicant inadvertently omits a document.

The negotiations can now move forward to discussing the future relationship between the EU and UK. The future relationship between the EU and UK, especially in relation to the movement of people, is likely to influence future immigration policy. On a related note, it was agreed that the UK will be able to negotiate trade deals with third countries during the transition period on the provision that these will only be effective after the end of the transition period on 31 December 2020. Again, these trade deals could have an impact on future immigration policy, as we saw with the recent EU-Canada Comprehensive Economic and Trade Agreement (CETA) and the Trans-Pacific Partnership(TPP).

Employers in the UK will now be eagerly awaiting further information in a number of key areas, including:

  • The mechanics of the application process for residence documentation, in order to support their employees through what is likely to be a challenging period.
  • Post-Brexit immigration policy, to ensure that they continue to have access to global talent to drive business growth and fill skill shortages.
  • Compliance responsibilities with respect to ensuring that their employees apply for residence documentation within the specified timeframe, i.e. prior to 30 June 2021.

While we wait for information on the above, this latest announcement does give employers a degree of certainty to at least start planning for the Brexit transition and reassuring employees as to their future status in the UK.